Undecided Regulator

The Securities and Exchange Board of India recently circulated among leading merchant bankers draft copies of the consolidated Disclosure and Investor Protection guidelines. One of our journalist friends managed to get hold of a copy of the draft. Under the title 'Rationale for amendments to part I of DIP guidelines', there was a highlight box which summarised changes made by the regulator. The box clearly stated that Sebi is thinking of gradually doing away with the requirement of promoters contribution and lock-in. A senior Sebi official admitted that the board had discussed the issue and was divided. While it could not be confirmed if it will actually happen, the regulator has already made its intentions clear in the draft. While on one hand merchant bankers are told that gradual phase out will take place, on the other hand Sebi officials have verbally rejected any such proposal at this stage. Every printed matter that the regulator circulates is considered to be sacrosanct. If these things continue,Sebi officials may just spend half of their time in admitting one thing and denying another.